Posted on 03/04/2004 10:31:36 PM PST by scripter
An effort to do away with federal income tax and replace it with a national consumption tax is gaining steam, as activists strive to get at least 100 members of the House of Representatives on board by Independence Day.
"We think we'll be at 100 co-sponsors by July 4," Tom Wright, executive director of Americans for Fair Taxation, told WND.
Wright noted the House bill, H.R. 25, added its latest co-sponsor this week Republican Rep. Barbara Cubin of Wyoming bringing the total to 44.
"We're working with our grass-roots people across the country" to get to the goal, Wright said. H.R. 25, the Fair Tax Act, is sponsored by Rep. John Linder, R-Ga., who has sponsored similar legislation for the last several years. The latest version of the bill was introduced Jan. 7, 2003.
"The current federal income tax system is broken. Patching up the existing code is pointless. It's time for a fresh approach, a fair approach. It's time for the FairTax," says the group's website.
"From its humble beginnings, the income tax has grown like a cancer by taxing our hard work and discouraging savings and investment."
H.R. 25 would eliminate the federal income tax and replace it with a 23 percent consumption tax paid by the end user. That means business-to-business purchases for the production of goods and services would not be taxed. The organization estimates consumer prices will drop by an estimated 20-30 percent as a result of the change.
The group's website describes how the bill's rebate function works. It assures that those living in poverty would not pay any tax.
"Under the FairTax, no American will pay taxes on necessities. The rebate will be equivalent to the tax paid on essential goods and services. The rebate will be mailed before the tax is actually paid [and] will be paid in equal installments at the beginning of the month. The size of the monthly rebate will be determined by the federal poverty level for a particular household size."
Wright touted the support of the American Farm Bureau. The organization has been educating its membership on the bill, and many state chapters have given the bill legislative priority.
Dumping the income tax has become a campaign issue in many political races this year, Wright says.
"All over Texas, House candidates are supporting it," he said, mentioning races in other states as well.
Wright noted the bill's cause is helped every time Social Security reform is discussed, since, under the plan, the entitlement program would be supported by the consumption tax instead of what he calls the "regressive" Social Security tax.
Americans for Fair Taxation says the first year the plan goes into effect, revenue to the federal government would remain the same. From there, the group claims, revenue will grow due to increased economic activity.
H.R. 25 is pending in the House Ways and Means Committee and has not had a hearing. Once the sponsorship level grows to 100, however, Wright thinks Chairman Bill Thomas, R-Calif., will take action on the bill.
The bill's Senate version is S.1493, sponsored by Sen. Saxby Chambliss, R-Ga., which was introduced in July.
WND columnist Neal Boortz is a supporter of the plan. In an August column, he addressed the issue of why the idea hasn't been enacted already.
"And just why hasn't it passed?" he wrote. "Because the idea is so bold that many politicians, while personally praising the concept, just assume it can't pass.
"It can pass, my friends. It can pass if the people of America learn the details and then let their elected officials know that they want some action."
Previous stories:
Income tax to end within few years?
National sales tax gains momentum
Group plans 'fair tax' convention
Congress to consider 'fair tax'
But 23%?
That absurd number causes me to reel away in horror.
It is so horrendous that it
should be used to demonstrate the real tax burden,
in reasonable argument of the need for
further cuts.
Effective Total Federal Tax Rate (Percent of gross income) | |||||||||||
Income Category | 1977 | 1979 | 1981 | 1983 | 1985 | 1987 | 1989 | 1991 | 1993 | 1995 | Projected 1999 |
All Families | 22.8 | 23.4 | 23.5 | 21.4 | 21.8 | 22.6 | 22.5 | 22.6 | 23.5 | 24.7 | 24.2 |
Data from IRS collections statistics and The Bureau of Economic Analysis as compiled in tabular form by the Congressional Budget Office.
http://www.cbo.gov/showdoc.cfm?index=1545&from=4&sequence=0
Problem is that the greatest precentage of folks never recognize the burden for all they really percieve is their net tax owed at the bottom of the 1040. That usually returns them something, even if it is there own money.
A government which robs Peter to pay Paul can always depend on the support of Paul.
-George Bernard Shaw
Those who perceive little burden play the role of Poor little Paul:
Effective Individual Federal Income Tax Rate (Percent of gross income) | |||||||||||
Income Category | 1977 | 1979 | 1981 | 1983 | 1985 | 1987 | 1989 | 1991 | 1993 | 1995 | Projected 1999 |
Lowest Quintile | -0.6 | -0.8 | -0.2 | -0.5 | -0.2 | -1.3 | -1.9 | -2.9 | -3.4 | -5.6 | -6.8 |
Second Quintile | 3.6 | 3.9 | 4.6 | 3.5 | 3.9 | 3.2 | 3.3 | 2.7 | 1.8 | 1.8 | 0.9 |
Middle Quintile | 7.1 | 7.5 | 8.3 | 6.8 | 6.8 | 6.1 | 6.5 | 6.3 | 5.9 | 6.1 | 5.4 |
Those that readily perceive some of the burden.
Effective Individual Federal Income Tax Rate (Percent of gross income) | |||||||||||
Income Category | 1977 | 1979 | 1981 | 1983 | 1985 | 1987 | 1989 | 1991 | 1993 | 1995 | Projected 1999 |
Fourth Quintile | 9.7 | 10.4 | 11.3 | 9.5 | 9.3 | 8.7 | 8.9 | 8.7 | 8.5 | 8.7 | 8.4 |
Highest Quintile | 15.8 | 16.3 | 17.1 | 14.5 | 14.3 | 15.1 | 15.1 | 14.8 | 15.5 | 16.2 | 16.1 |
To play the role of mean ole Rich Peter.
While Congress plays both ends against the middle; hiding the real burden in inflation, higher prices on all goods and services, lower takehome pay, lower return on investment, and higher interest rates. All keeping the poor right where they are and pushing for more freebees.
Right now the bottom 60% perceive little to no "Individual Income Tax" burden,(in many cases even a handout) and 70% of the voting public clamor for more from government looking for the top 40% of income earners/producers to foot the bill. That perception continues to grow ever stronger by eliminating even more participants from the Federal Individual Income Tax rolls as proposed in the tax reduction proposals through changes in personal exemption limits and other mechanisms such as the EITC.
Walter Williams, World Net Daily, 10-25-2000
If you're among those who pay little or no federal income taxes, what do you care about tax cuts? *** So many Americans paying little or no federal taxes makes for a natural spending constituency. It's like me in the restaurant: What do I care about extravagance if you're footing the bill?
Dancing around how we collect it will do
nothing except run the real risk of
decreasing consumption and potentially
grinding the economy to a halt.
Furthermore, making the real tax burden visible is the whole issue. You pay that 23% and more now whether you recognize it or not, so does everyone else (embedded into the price of products).
If people cannot perceive the tax that is upon them, they blame everyone but the real culprits(Congress Critters) for not having enough to live on.
Once the real cost of government is visible even to that welfare mother out there, then things start becoming possible in reversing the trend of growth in government.
To remove taxation of the individual, is to remove the goad which assures accountability of government to the electorate. Federal tax rates are high because a majority of the electorate do not share proportionately in the burden their demand for largesse imposes on the minority of citizens.
The siren call for representation without taxation is the formula that got us where we are at today. The ability to hide or disguise taxation from the view of large sectors of the electorate allows the Congress to get away with the creation of the evergrowing monster that it fosters.
Liberty and freedom have a price, responsibility. If that price is avoided there are no brakes on the growth of government, the ultimate result is the end of freedom through creeping socialism.
On large puchases, would folks finance the tax, pay interest?
Is the tax taken up front?
What do you do now under the income/payroll tax system. Why would anything change just because you get your full gross pay in hand, instead of government whacking you on it before you even get it.
Secondly see reply #40, 20-25% of what you now pay in the price for large ticket item, will decrease prices such that shelfprice + NRST is the same amount that you see a shelf price today.
Would finance companies have to carry and collect
this debt for free?
Do they now? If you purchase anything on credit today, more than 25% of the price you are paying is embedded federal taxation. You get any discount in loan interest rates because of that?
This number would have to be in the single digits to have any chance of public acceptance.
Effective Total Federal Tax Rate (Percent of gross income) | |||||||||||
Income Category | 1977 | 1979 | 1981 | 1983 | 1985 | 1987 | 1989 | 1991 | 1993 | 1995 | Projected 1999 |
All Families | 22.8 | 23.4 | 23.5 | 21.4 | 21.8 | 22.6 | 22.5 | 22.6 | 23.5 | 24.7 | 24.2 |
Data from IRS collections statistics and The Bureau of Economic Analysis as compiled in tabular form by the Congressional Budget Office.
http://www.cbo.gov/showdoc.cfm?index=1545&from=4&sequence=0
& 70% of the voting public clamor for more from government
Think maybe if they see what they really pay they might change their minds alittle?
23%........... Effective total federal tax rate with respect to consumption expenditure
14.91% ..... rate if Social Security and Medicare were eliminated
14% .......... rate if Nat'l Endowment for the Arts were eliminated
11.9%........ rate if Dept. of Education were eliminated
10% .......... rate if welfare were eliminated
9.8%.......... rate if foreign aid were eliminated
etc.
Single digits, quite possible once the horseblinder are remove from the eyes of the electorate. But not before that happen, as history demonstrates all to clearly.
I just hope they make sure to remove the "roots" of the oppressive income tax, by repealing the 16th Amendment.
That way, just like when you eradicate poison ivy, it won't come back!
It's up to us to make sure it gets done properly and with express prohibition of all income taxes not just repeal of the 16th(otherwise taxes on wages and employments remain possible):
H.J.RES.61
Title: Proposing an amendment to the Constitution of the United States to abolish the Federal income tax.
Sponsor: Rep Johnson, Sam [TX-3] (introduced 6/24/2003) Cosponsors: 5
Latest Major Action: 9/4/2003 Referred to House subcommittee. Status: Referred to the Subcommittee on the Constitution.
That will never happen with out a viable replacement tax system in place first, and total public support to achieve the necessary 2/3rd of both Houses of Congress plus 3/4ths of the states necessary for ratification.
I would love to be ebnthusiastic about this, but the supporting arguments are far too sophisticated and technical to have any chance against the anticipated
Drat media soundbyte war.
Soundbytes? no problem.
-- a free people that pays slave taxes to its government is willingly training itself for bondage.
Alan Keyes 1999
[Montesquieu wrote in Spirit of the Laws, XIII,c.14:]
- "A capitation is more natural to slavery; a duty on merchandise is more natural to liberty, by reason it has not so direct a relation to the person."
--Thomas Jefferson: copied into his Commonplace Book.
I can easily imagine giant malls in Canada and Mexico, and the development of a "Television Underground".
Or Buy your big screen TV from the Mexican/canadian internet supplier, delivered to your door. Or a Chinese based company warehousing there.
"It is a signal advantage of taxes on articles of consumption
that they contain in their own nature a security against excess.They prescribe their own limit, which cannot be exceeded without
defeating the end proposed - that is, an extension of the revenue.When applied to this object, the saying is as just as it is witty
that, "in political arithmetic, two and two do not always make four."If duties are too high, they lessen the consumption; the collection
is eluded; and the product to the treasury is not so great as when
they are confined within proper and moderate bounds.This forms a complete barrier against any material oppression of the
citizens by taxes of this class, and is itself a natural limitation of
the power of imposing them.
You were the one wanting single digit rates, were you not?
the tax burden that a family of four will have at various annual income levels (or in this case, annual spending levels).
Do you set up a sales tax police force?
You let the state tax authorities do the same job they do now in 45 of the 50 states that collect their own retail sales taxes.
H.R.25, S.1493
A bill to promote freedom, fairness, and economic opportunity by repealing the income tax and other taxes, abolishing the Internal Revenue Service, and enacting a national retail sales tax to be administered primarily by the States.
Please add me to your ping list. Being on the ping list will help remind me to look for similar articles, and then perhaps I can beat you to posting more articles. :-)
Being on the ping list will help remind me to look for similar articles, and then perhaps I can beat you to posting more articles. :-)
And then I can sleep late in the morning.
You just bought your way onto my very exclusive ping list LOL.
Why would prices have to drop....your salary would increase 8% almost just from social security not being witheld PLUS your income tax witholding....how much is that extra in your pocket EVERY week?...NOT TO MENTION THE POVERTY LINE REBATE CHECK EVERY MONTH!!!
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